Sentosa Cove Condo Owners Sue Singapore Builder Over Construction Defects

By Andrea Tan and Pooja Thakur | September 9, 2013

Owners occupying almost half the units at a luxury apartment building on Singapore’s resort island of Sentosa sued the developer over alleged defects.

Ho Bee Investment Ltd. failed to fix termite-infested pool decking and flooded staircases in the common areas at the 249- unit The Coast at Sentosa Cove, 108 of the owners claimed in a lawsuit filed on their behalf by the property managers in the Singapore High Court. The owners also sued three contractors.

“Complaints from residents to developers happen all the time but it’s not that common for it to go to court,” said Vikrant Pandey, a Singapore-based analyst at UOB Kay Hian Pte, who has a “buy” rating on Ho Bee. “It will slightly tarnish their image, but you have to see their track record for their other projects too.”

Ho Bee was the first condominium developer in Singapore’s Sentosa Cove, an estate carved out by the government as the only place foreigners are allowed to buy houses. The area is located on the eastern part of Sentosa, a resort island that’s home to Genting Singapore Plc’s casino and Universal Studios theme park.

Ho Bee denied the allegations in Aug. 27 court filings, blaming the defects on the management corporation’s negligence. Responsibility for maintenance of the complex, completed in April 2009, was handed to the management committee in December 2010, the developer said.

Reviewing Lawsuit

“We are defending ourselves,” Ho Bee’s executive director Desmond Woon said today in a phone interview. “Not all the claims are reasonable, we will look into it and respond accordingly.”

Edwin Lee, a lawyer representing the homeowners, declined to comment.

A company linked to Gina Rinehart, Asia’s richest woman according to the Bloomberg Billionaires Index, bought two apartments on the island for $44.9 million, The Business Times reported in July, while a bungalow on the island sold for a record price per square foot in October.

The Coast “will provide an unparalleled setting for your abode,” Ho Bee said on its website, showcasing waterfront apartments with views of the South China Sea. A 3,100-square- foot apartment at the Coast was sold for S$4.5 million in July, while a 2,024-square-foot home fetched S$3.6 million in April, the only two transactions this year based on records from the Urban Redevelopment Authority.

The Coast is among five developments Ho Bee has completed on Sentosa Cove, according to its website. It’s selling homes of two projects and has another in the pipeline for future sales, it said.

The case is The Management Corporation Strata Title Plan No. 3493 v Ho Bee Cove Pte, S688/2013. Singapore High Court.

(With assistance from Grant Clark and Netty Ismail in Singapore. Editors: Joe Schneider, Linus Chua)

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